Many of you have likely had work completed on your historical home or building. Consequently, many of you have also likely felt the impact of labor shortages in the construction industry. This article focuses on the skilled labor shortages and how they affect your project. The skilled labor shortage in the trades has been a major concern for over a decade, particularly since the global financial crisis of 2008. In March 2019, the National Association of Home Builders (NAHB) described the shortage – based on a survey of its members – like this: 

“More than four out of five builders expect to face serious challenges regarding the cost and availability of labor in 2019 … Just 13% of builders cited labor issues as an important concern in 2011, with the rate steadily rising over the ensuing years and peaking at 82% in each of the last three years (2017–2019).” [NAHBNow]

The number of shortages vary based on skill-specific trades, but broad shortages are higher in recent years. This presents a conundrum to leaders in the construction industry, but also to you, the homeowners. We have attempted to outline the breadth of the issues as well as possible solutions and strategies to cope, both from a societal stand-point and an individual homeowner perspective.

If you aren’t interested in how we got here, specific action items for hiring a contractor and dealing with the labor shortage are here

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WHY IS THERE A SHORTAGE OF SKILLED LABOR?

We already know that there is a shortage of skilled labor in the construction industry. The question is: How did we get here?

• Historical contributions. Clayton DeKorne provides a detailed overview of some of the likely factors that contributed to the shortage. For example, he noted that in early America, especially prior to the Revolution, the predominant view of skilled laborers in the construction field was a venerable one, and these craftsman enjoyed involvement in a cooperative community of workers, as well as esteem by and support from society at large. A prime example of this, as noted by DeKorne, is The Carpenter’s Company, the oldest trade guild in America. It held its first meetings in Carpenter’s Hall in Philadelphia, right among major centers for government and business. The building and the guild both hosted and provided for government and business in substantial ways. As time passed, the predominant views in America about construction and skilled labor culminated in Charles Ham’s book, Mind and Hand, which viewed industrial arts as a necessary precursor to children’s moral and intellectual development, rather than simply vocational training. DeKorne reports that another characteristic of these historical time periods was that traditional craftsman often passed skills on to their children, maintaining and ensuring traditional skills through the generations. However, as innovations in technology emerged, including “retail product manufacturing,” the need for skilled craftsman declined as the press for manufacturing workers increased. This included the children and youth who previously learned trades alongside their parents. But by 1917, child labor was increasingly frowned upon. The Smith-Hughes Act of 1917 was a federal law passed with the intention of education reform, triggered in large part by concerns related to ethical issues and lack of safety for children in the workforce. DeKorne notes this Act, while beneficial in limiting child labor, was a driving force behind the fall of vocational education in America. Although this bill provided significant federal funding to educational avenues, including vocational education, it set into motion policies and practices that eventually resulted in a distinct separation between college-prep and vocational education, the educational tracks we see to this day. The unforeseen and possibly unintended consequences of this have been a class or social divide, or at least a perception of one, that is still present.

• Recent issues. McKinsey and Company wrote an article that reports that there was a 70% decrease in new housing projects from 2009-2011, resulting in many in the construction industry leaving the workforce, following the 2008 recession. In the years since, the demand for skilled laborers in the construction industry has significantly increased as construction needs have increased. However, workers are not filling those gaps.  DeKorne and homeadvisor.com conclude that a large part of the growing shortage is because of younger generations’ negative perceptions of the industry, including deeply-held beliefs that trade skills are associated with a lower or under-served-class of people. They have held onto the belief that a 4-year degree or college is more respectable, per the standards developed by the educational system throughout most of the twentieth century (noted earlier), and schools have phased out vocational programs and encouraged students to focus on college, perpetuating the idea that it is somehow better. This also reduces students’ exposure to the construction field as a potential option. Many of these people are more interested in innovative, technological careers. These problems are compounded by aging workers retiring from the field. 

HOW CAN WE ADDRESS THE SHORTAGE?

There are several things that experts suggest that leaders and professionals in the educational, vocational, and construction fields do, as well as suggestions for homeowners like you.

• For professionals. Homeadvisor.com proposes that professionals make the most of the maker movement and foster people’s interest by offering alternatives to a 4-year-degree, harness their motivation to be entrepreneurs (since many surveyed indicate owning a business is a big motivator, and create mentorships and apprenticeships.  They also recommend labor automation, hiring temps, using overtime with current staff, and expanding hours of staff availability.

• For homeowners. If you read most of this article prior to this section, or if you’re already abreast of the issues of labor shortage in the industry, you might be feeling discouraged as to any possible immediate solutions. However, we have compiled a list of things that you can do as a homeowner to navigate this issue, from our experience and that of other sources (Homeadvisor.com, thisoldhouse.com, Jon Gorey at realestate.boston.com, Marni Jameson of The Mercury News, and The National Trust for Historic Preservation).   
  • SCHEDULE IN ADVANCE – call before problems happen so you are more likely to get things addressed when they are problematic. This also builds rapport with contractors and laborers.  
    • HAVE A MAINTENANCE PLAN – find examples and ideas here. 
    • BE FLEXIBLE – Due to uncontrollable aspects of the current circumstances, it’s best to accept them as they are and be flexible with them. You can do this by allowing more time for projects to be completed, considering simplifying your projects, or moving your own schedule around to match that of contractors’ schedules. Also remember that subcontractors often prefer to work with general contractors or well-known companies, so they may not consider small home projects to be a priority. Consider contacting someone you have an existing relationship with for smaller projects, or a handyman service that specializes in smaller projects.
    • BE AWARE OF COST – The reality is that this shortage will impact the cost of your project. As the demand for highly skilled workers increases (especially for workers who have specialized skills in restoration/preservation rather than general remodeling) and the supply of highly skilled workers decreases, the demand on these contractors and workers also increases (usually beyond capacity) which will drive up the costs. 
    • HAVE A LIST OF PROS – Create a list of people with whom you build relationships. If they know you are a reliable customer, you are more likely to find them to be reliable professionals. They may be more likely to be flexible with you compared to unfamiliar, possibly demanding customers. 
    • DEFER TO A NATIONAL ASSOCIATION – NAHB and the National Association for the Remodeling Industry have pro-finder tools that will help you discover professionals in your area. Ensure that the contractors have experience in historical restoration and/or preservation.
    • DO YOUR OWN BACKGROUND CHECKS – High demand in a limited labor market is a breeding ground for less-than-satisfactory work from certain contractors, who may take advantage of the situation and be less reliable because they feel they have the freedom to do so. Also, many contractors are desperate for subcontractors and no longer requiring screenings, allowing this to fall to the homeowner. Make sure they are a licensed contractor, ask for proof of insurance, call references, and check out websites like court records to make sure no suits or complaints are filed against them. Particularly, make sure they do not have numerous claims against them regarding workmanship or breach of contract.
    • DON’T SETTLE – Although this checklist may seem daunting, don’t settle for sub-par work or possibly unsavory workers, despite all of the seeming barriers. 

IN SUMMARY: 

Unfortunately, even choosing a reputable contractor is not always the solution you would assume it would be and much onus is put on the homeowner or property owner as a result. Recently, I saw a job posting for a large, well-established contractor advertising 3 positions: construction site manager, field superintendent, and entry-level field assistant. The fact that they have the 3 levels of position available does not surprise me. What shocked me was the fact that they were advertising that they do NOT complete or require drug screens or background checks. I can tell from personal experience  that the number of applicants dramatically decreases when you add those qualifiers to the help-wanted ad. This concerns me not only from a safety standpoint, but also from a customer service angle. Someone who is abusing drugs will not be reliable (drug abuse is a huge problem in the construction industry). Just having a body show up is not the same as someone who is there to work (not to mention the liability implications). I am not opposed to second chances in regard to background checks; depending on the circumstances I would consider hiring someone with a blemish on their record, but I would want to know about it and evaluate it from a risk-assessment standpoint. As some contractors are lowering their standards to hire workers, don’t be afraid to ask questions about the labor force and the type of screening that is completed. 

In addition, you can hire for speed, cost, or quality choosing 2 of the 3 priorities, but the 3 cannot be accomplished on the same project. One question we are often asked is: what is the best way to find a reliable skilled contractor who won’t be too expensive? My answer is: It is hard to find an inexpensive skilled carpenter because the cost of labor goes up as skills are learned, and you are paying for the knowledge that has been previously acquired so they are not making expensive mistakes on your property. As a strategy, I would look at what work is unskilled/semi-skilled (it typically follows the 80/20 rule for window restoration, for example). With minimal training, you can either self-perform or pay a college student to do the unskilled work, bringing the skilled carpenter in for the repair work without having to pay a high hourly rate for the unskilled portion of the project. 

Ultimately, there is a lot required of you as a homeowner to find the right contractor and skilled laborers, but it will be worth it in the end.